REVENUE MEMORANDUM CIRCULAR NO. 33-2004 issued on June 8, 2004 circularizes Joint DTI–DOF–BOC-BIR Administration Order No. 01 Series of 2004 which prescribes the revised rules and regulations implementing Republic Act No. 8502, otherwise known as the “Jewelry Industry Development Act of 1998”.
     To encourage the development of the jewelry industry, the following incentives shall be available to Qualified Jewelry Enterprises:
     (a) Entitlement to zero duty on imported raw materials which include precious/fine metals, loose gems, precious stones, jewelry parts, accessories, and supplies for use by Qualified Jewelry Enterprise;
     (b) Exemption from the imposition of excise tax on all goods commonly or commercially known as jewelry, whether real or imitation pearls, precious and semi-precious stones and imitation thereof; all goods made of, or ornamented, mounted or fitted with precious metals or imitations thereof;
     (c) Entitlement to zero duty on imported capital equipment, including spare parts and tools thereof;
     (d) Additional deduction from taxable income of 50% of expenses incurred in training schemes approved by the appropriate agency and which shall be deductible during the financial year the expenses were incurred;
     (e) Gold and silver sales by the Bangko Sentral ng Pilipinas under minimal margins;
     (f) Authority to buy gold and silver directly from other sources without any specific authority from the Bangko Sentral ng Pilipinas. However, this shall not include sale of gold and silver from small-scale miners;
     (g) Inclusion of locally manufactured jewelry products in the government’s tourist duty free shops, including the promotion, advertisement, and sale of jewelry products;
     (h) Incentives provided for by other special laws, such as: Republic Act No. 7844 (Export Development Act of 1994); Republic Act No. 7916 (Special Economic Zone of 1995); and Executive Order No. 226 (BOI Omnibus Investment Code).
          Provided that, the jewelry enterprise shall register under the aforestated laws, or that the activity is export-oriented, and that there is no double availment of the same incentives.
     To qualify for the availment of the aforesaid incentives, an applicant jewelry enterprise (Applicant) must either be a single proprietorship, cooperative, corporation, partnership or organization established and duly authorized to do business under Philippine laws. In case the applicant is a corporation , the area of activity in which it is engaged or proposing to engage is within its corporate purposes as indicated in its Articles of Incorporation. Applicant should also have secured a Mayor’s Permit or City/Municipal Business Permit, appropriate BIR Registration and endorsement by a duly accredited jewelry association certifying that its membership is of good standing.
     The applicant must also be engaged or proposing to engage in any of the activities of a jewelry enterprise. For activities in support of jewelry manufacturing, the following qualifications are further required:
     (a) For Assaying – the accredited firm/facility shall secure accreditation from and shall adopt the standards to be set by the Bureau of Product Standards (BPS).
     (b) For Precious Stone Appraisal and Certification – precious stone appraisal and certification shall be based on the standards and accreditation to be set by the BPS.
     (c) For Subcontracting of Jewelry Manufacturing – the jewelry enterprise shall enter into an agreement with another Qualified Jewelry Enterprise engaged in jewelry manufacturing to perform any or specified part of the manufacturing process.
     For jewelry associations, the following qualifications are required:
     (a) It must be duly registered with the SEC;
     (b) It must be at least 1 year in existence for member of the Confederation of Philippine Jewelers, Inc., otherwise, the jewelry association must be at least 3 years in existence; and
     (c) It must have at least 10 active members
     The requirements and procedures for accreditation are specified in the Circular, as well as the procedures for the release of tax– and duty–free imported articles and availment of additional deduction for training expense, among others.